Amir Mizroch and Maarten van Tartwijk report:
Gemalto NV, one of the world’s largest cellphone SIM-card providers, scrambled Friday to respond to a report that U.S. and British intelligence agencies hacked into its systems.
The alleged hack–reported by a news site that has been a conduit of leaks from former National Security Agency contractor Edward Snowden–raises fresh questions about Western governments’ attempts to tap into private companies to gain access to personal-communication data, potentially circumventing legal procedures and privacy safeguards.
For Netherlands-based Gemalto, it also raises the prospect of significant financial pain, with some analysts saying the company may be forced to recall chips if the alleged leak raises widespread worry among telecommunications customers or individual users over privacy.
Shares in the digital-security company–whose customers include customers including telecommunications giants China Mobile Ltd., Vodafone Group PLC and Verizon Communications Inc.–fell nearly 7% at one stage in Friday morning trading in Amsterdam.
Read more on Nasdaq.
Related: Gemalto Statement